NKG2D is an activating receptor that is expressed on most natural killer (NK) cells and CD8(+) T cells. MHC class I-related chain A(MICA) and UL16-binding protein (ULBP) 1, 2, and 3 are well-known ligands for NKG2D. Human gastric cancer cell lines, SNU216 and SNU638 cells which expressed UL16-binding protein (ULBP) were susceptible to NK cells in a NKG2D-dependent manner. However, SNU484 and SNU620 cells which had no ULBP on their surface were resistant to NK cells. ULBP 1, 2, and 3 are glycosylphosphatidylinositol (GPI)-anchored proteins which are sensitive to phosphatidylinositol-specific phospholipase C (PI-PLC). When SNU620 cells were treated with U73122, an inhibitor of PI-PLC, the surface expression of ULBP was elevated with increased NK susceptibility. Pre-incubating NK cells with culture supernatants of SNU620 or SNU638 cells, which contained soluble ULBP protein, reduced NK cell activity by decreasing surface expression of NKG2D in NK cells. Furthermore, recombinant ULBP-Fc induced the down-regulation of NKG2D expression in NK cells. Taken together, down-regulation of NKG2D by soluble ULBP provides a potential mechanism by which gastric cancer cells escape NKG2D-mediated attack by the immune cells.